We have just a little over five months until the world gathers in Copenhagen to consider the next global climate deal. Precisely how those negotiations will go is difficult to predict, but I do know this: around the world there is unprecedented pressure on governments for something to be done.

Suddenly, everyone is talking about the low-carbon, resource-efficient economy that is going to create green jobs, help mitigate climate change and ease the impacts of a population that is growing, in numbers and in wealth, in developing countries.

The Clean, Lean, Mean industrial revolution gets a little closer every day. The United States, the European Union and China all want to be leaders in “cleantech” products and services and are allocating more funding to develop and promote technologies that will achieve this.

But there are still some serious stumbling blocks to be overcome during and after the Copenhagen talks.

Not least among these will be the vexing issue of historic carbon emissions. Much has been said here about the US and China, and how each will play a pivotal role.

I believe China will come to Copenhagen knowing that it needs to take a forward-looking, solutions-oriented approach if it wants to maintain its export markets, but it will not want to take responsibility for historical emissions created by others, most significantly the US. It will look to the US and the position it takes.

The US, on the other hand, has its own issues, too. The Obama administration is driven by a domestic agenda: it wants to cut the nation's fuel imports and is also concerned about its agriculture and food supplies. As well, it fears that climate change could be a destabilizing factor around the world and that as the leading military force it would have to deal with this. The US will come to Copenhagen, I believe, ready to talk but perhaps too soon for it to do a deal.

These concerns alone could be enough to bog down the Copenhagen talks, but there are others: financial flows, technology transfer and trade are just three.

Financial flows to developing countries will be particularly important. At the Earth Summit in Rio de Janeiro in 1992, at which the United Nations Framework Convention on Climate Change was agreed, developing countries were promised 0.7 per cent of signatory nations' GDPs in return for protecting the environment. They never got that money, and now would like the promise honored as well as additional financial support to reduce greenhouse gas emissions going forward. And, given that some level of climate change seems inevitable because of historic emissions, developing countries would like funds to help them adapt.

Overall, this adds up to a considerable sum of money that recession-hit developed countries may be unwilling or unable to provide.

Developing countries also want the transfer of technologies to help them transform their economies and build energy-efficient infrastructure. There is a proposal that this transfer should be paid for from a fund amounting to 1 percent of GDP in industrialized countries. These funds should pay for the technology, as well as buy intellectual property rights.

And then there is the issue of trade. I am coming to the conclusion that globalization, open trade and free markets are all hanging in the balance as the pressures to kickstart economies and reshape them as low-carbon entities take hold.

The global business community that wants free trade, open markets, freedom of investments and a level playing field needs to strengthen its voice about the risks ahead. There is absolutely no doubt that climate change must be arrested, and business stands ready to play its part in finding and implementing the solutions. But if we want to encourage sustainable growth, to provide jobs, livelihoods and advancement around the world, then care must be taken not to damage the global marketplace we have worked so hard to establish.

Many of us are proud of our homes, and spend a great deal of time and effort making them comfortable. Some save much of their lives to buy one of their own, while elsewhere in the world others merely want to be able to live in one. Sizes, styles and sturdiness vary, but all have an impact on the world we live in no matter where they are.

Around the world, more and more people are converging on cities, many of them hoping to better their lives. By 2050, 70 percent of people are expected to be urbanized, and all will need something to live in.

 

At the same time, the total number of people is increasing. The world's population is expected to grow by 50 percent, or three billion people, by 2050. Some 85 percent are expected to live in what we now call developing countries, and all of these too will need housing.

The pressures people put on the planet continue to grow, and so do the number of buildings we construct, to live and work in, to house manufacturing and other industries.

But few people know that buildings are responsible for about 40 percent of the world's current energy use and about a third of our carbon dioxide emissions. This is more than any other sector. Based on 2050 projections, energy savings in buildings could save more carbon dioxide than the entire emissions of the transport sector.

The potential is huge. The knowledge and technology we already have could achieve dramatic reductions, but we are moving at a snail's pace.

This past month we at the WBCSD have tried to pick up the pace by releasing our report, Transforming the Market: Energy Efficiency in Buildings. The report is the result of a four-year $US 15 million study that shows how energy use in buildings can be cut by 60 percent by 2050.

Energy efficiency is widely regarded as the most cost-effective way to mitigate climate change. Much of the technology we need to do this is already available. So why are we not doing more?

We do not need to wait until a deal is reached on a new climate agreement in Copenhagen. We can get started now.

In the building sector this means educating building professionals, a holistic approach to design, financial mechanisms that encourage investment, and behavioral changes in society as a whole so that consumers begin to embrace energy efficiency .

Each and every one of us needs to become energy-aware. We need to demand buildings that consume zero net energy, to demand transport systems and vehicles that have lower greenhouse gas emissions, and to expect products that use as little energy as possible.

The International Energy Agency says energy efficiency accounts for half the potential to reduce global greenhouse gas emissions by 50 percent by 2050. So what are we waiting for?

My view is that now is precisely the time it should be. Right now it should be clear to everyone that we cannot go on as we have been.

What we have now is a rare chance to re-shape our world. I believe that we are living in a moment of history, that all around us a new industrial revolution is beginning.

This will be the “lean, mean, clean” revolution. It will be clean because we know we cannot go on polluting as we have been and maintain functioning ecosystems; it will be lean because a growing population and the need to alleviate poverty will leave us with a resource-constrained world with higher prices for food, oil and gas; and it will be mean because the transformation this revolution will bring will create winners and losers.

It is true that for some countries and some businesses there will be difficulties ahead as economic recession bites. The same is true for individuals, some of whom will struggle after they lose their jobs. We should not lose sight of this.

But even in the face of these challenges there will be opportunities. We need to seize the moment and make the most of these. Our new industrial revolution depends on it.

The stimulus packages that are being discussed and put in place in different parts of the world have triggered a debate about what all this money should be used for.

Just how do we build a more sustainable society with lower energy and resource use? How do we create the green jobs that will be needed to deliver these solutions? And how do we create a societal infrastructure that will be more resilient to the challenges of climate change and its impacts on our food and water supplies?

The amount of investment needed for energy, urban infrastructure, water, transport and food supply, to mention a few, will be tremendous. We cannot allow these investments to lock us into an unsustainable future.

The infrastructure we invest in today will be with us a long time, often 50 years or more. It is vital that governments remember this when designing their stimulus packages. They need to look forward to the low-carbon economy of the future and focus on investments in new energy systems, transport solutions, energy-efficient buildings and water and urban infrastructure. Making the right decisions now will spur new industries, create green jobs, change our lives and secure our future.

We need to be thinking across the board, and outside of the usual constraints. With vision, foresight and planning we will re-shape our world. Imagine, for instance, a life in the future, where our homes and industries are powered by low-carbon energy, where transport runs on clean fuels, where even the poorest people have easy access to clean water, where our buildings and household appliances consume less energy, and where workers equipped with new, “green” skills are employed in the abundant jobs these new industries create.

We can design this better world, but we will not do it by thinking in silos and within narrow national borders. We need a global view, not business as usual. And we need to understand that the economic recession has given us a small window of opportunity for transformation. We must take advantage of it. Future generations will not thank us if we fail.

Earlier this month I was in India for the Delhi Sustainable Development Summit. This is an interesting event that each year brings together opinion leaders from around the world for an exchange of views.

This year, hardly surprisingly, there was much discussion about the global economic downturn, stimulus packages, the future of sustainable development, and fairness for developing countries in climate negotiations.

But there was talk, too, about how we all suffered from a lack of vision for a better future, that our discussions were based on fear, not desire for something better. A positive vision, it was felt, would encourage humans to “stop surviving and start living”.

I think this is how we should think about sustainable development, as an opportunity to do something better in future. I am often asked whether companies can still afford to invest in sustainable development. Of course they can. They are.

But the more positive approach would be to ask what opportunities sustainable development creates for us.

“Today, with the economic downturn and climate change, the stakes for companies have never been higher,” UN Secretary-General Ban Ki-Moon told the World Economic Forum at Davos last month. “But for businesses with vision the rewards are equally high.”

He's right. As we move towards a low-carbon economy, jobs will be created. Investment in sustainable technologies will create business opportunities; the technologies, once deployed, will need skilled workers to operate and maintain them, and this will create jobs.

The challenges ahead of us are huge. Governments and business will have to work together to achieve the kind of transformational change that will be needed. That partnership must be based on trust, and must be able to provide to the broader public a vision of what a sustainable future will look like, so that they trust and support the actions of that partnership in the challenging times ahead.

Business clearly sees the shift to a low-carbon economy as a significant opportunity. But the real challenge to growth will not be the global financial turmoil; rather, it will be the lack of a regulatory framework that allows business to invest with confidence.

That is why we must get things right in Copenhagen. And there is hope that we will. A big international effort is under way. The Obama administration in the US has clearly signaled its willingness to engage in the climate negotiations, China is making its own moves towards a low-carbon economy, and among other developing nations there is general agreement that they must be part of the solution, even if there are differing views about what that solution should be.

So here is my vision for the future: I see a world where we are well on track to big cuts in our greenhouse gas emissions, where business has a clear idea of what's needed and is encouraged to invest, where technologies such as carbon capture and storage are trapping harmful gases, where all countries are part of a new global agreement on climate, and where green jobs abound. I believe it can be done.

It is only January, but already it is clear that 2009 will be an important year for those of us working to stabilize our climate and put the world on a more sustainable path.

We do not know yet whether the international community will be able to reach an agreement on a post-Kyoto global climate accord at the United Nations COP 15 climate change conference in Copenhagen in December, though we continue to hope that it will. But one thing is certain, there will be no chance of an agreement in Copenhagen unless China and the United States agree between them that they need to address climate change in a coordinated manner.

These are the world's two biggest emitters of carbon dioxide, and though they may be poles apart politically, their “climate profiles” are similar. The US and China are the biggest users of coal and biggest polluters. As consumers of vast amounts of energy, both have an interest – economically and environmentally – in working for the development of clean energy and energy-efficient technologies.

It is true, too, that there are significant differences between the two, but these only highlight the importance of engaging them to achieve a global low-carbon economy. China's population is four times that of the US but its annual energy use is about two-thirds of America's. Historically, the US has produced more carbon than China, but if China fails to adopt clean energy technologies, and the fairly understandable aspirations of its people cause it to consume fossil-fuel dependent energy at the rate of Americans, then the climate battle is lost.

Currently, about 70 percent of China's energy is used by industry, and only about 10 percent as fuel for its transportation needs. An American is thought to be about 20 times more likely to own a car than a Chinese person (though car ownership grows daily in China), and the US uses much of its energy in transportation and its buildings as well as industry.

But what is not in conflict is the need for both countries to vigorously pursue energy and resource efficiencies, and the development and deployment of the low-carbon technologies that will help them achieve these. The economic well-being and energy security of these two nations will depend on this.

These pursuits will require investment and innovation, and it is here that business can play a role. Technologies are generally conceived, developed, deployed and later bought and sold by business, not countries, so engagement with business will be crucial for both nations.

Through my work as co-chair of the China Council for International Cooperation on Environment and Development ‘s Low Carbon Economy Task Force and elsewhere, I am aware that the Chinese government has already made significant efforts to reduce its carbon emissions. Its 11 th Five-Year Plan contains policies to reduce the country's contribution to climate change, including one to cut energy intensity – the amount of energy used per unit of economic output - by 20 percent by 2010. As well, many of its new power plants are being built with provision for the later addition of carbon-capture facilities and low-carbon cities are being built at Dongtan and Baoding.

In the US, this month's leadership change offers great opportunities. Incoming president Barack Obama has already said he intends for the US to take its place in the international arena on climate, and there are media reports that he plans prompt engagement with China on energy and the environment. This cannot come too soon. And some US states, for instance California, are already taking steps to mitigate climate change.

All of this does not negate the need for the rest of the world to work hard to find climate solutions. But, however 2009 unfolds, the spotlight is sure to fall on US and Chinese efforts. The success, or failure, of these will have a lasting impact upon us all.

Poznań is a city with an interesting heart. Its cobbled streets and historic market square rest at its core, deflecting with quiet dignity the bustle around it.

In the 10 th century the city was Poland's capital; today, it is Poland's fifth largest city and fourth largest industrial centre and a fitting place for the WBCSD to hold its Poznań Global Business Day.

The United Nations Climate Change Conference was in town, bringing with it some 11,000 participants, all adding to the bustle, and all there to try to help the world reach an agreement about how to fight climate change after 2012 when the Kyoto Protocol expires.

Under the umbrella of the conference and along with the International Chamber of Commerce, we held the Business Day to bring together more than 200 business leaders, governments, negotiators and representatives from civil society and other groups for face-to-face talks about the way forward.

It was our third Business Day – we had held one in Bali in 2008 and one in Johannesburg before that – and had some high-level turn-out, including Byron Blake, ambassador for Antigua and Barbuda and chairman of the G77 countries, Harlan Watson, US ambassador and special envoy for climate change, Kazuhiko Hombu, director-general of Japan's Ministry of Economics, Trade and Industry, and Brice Lalonde, France's ambassador for climate change negotiations.

It was a fairly intense day, full of debate and opinions. But I was impressed by the willingness of speakers to invest their considerable intellectual capital in helping to find a solution to one of the world's most pressing problems.

Later in the week I was able to present the key messages of the Business Day to the UN Secretary General Ban Ki-Moon, 20 ministers and other senior government representatives at a ministerial breakfast co-hosted by the WBCSD and the UNFCCC.

Much was discussed in Poznań but I came away with a firm conviction that business stands ready to work with governments to define a new public-private partnership for action on climate change.

Climate change is a fundamental issue for business. It will have major impacts upon how business does business. It is therefore right and proper that business has strong views on the global policy framework needed to address climate change.

We are fully aware that Poznań is not the end of the discussion. Much needs to be said before the next climate change conference in Copenhagen. And even more needs to be done.

When I woke up in Johannesburg on November 5th it was to the news that Barack Obama had been elected president of the United States.

We were in South Africa for the WBCSD's Council meeting, and at the opening plenary session later in the day, the talk among delegates was about the historic win and the difficult task ahead of Obama as leader of the world's biggest economy as it struggles with recession.

Obama outlined the challenges ahead in his victory speech: " … two wars, a planet in peril, the worst financial crisis in a century."

Around us, the financial sector is being re-shaped after a dramatic collapse in some parts of it, trust in the market has been eroded, and governments have been making a comeback as regulators and overseers.

In the past few weeks I have often been asked whether companies can still afford to invest in sustainable development. My answer is simple: yes.

Now is not the time to waver. In my view, the need for responsible business engagement in the big issues of our time is urgent.

The potent social and emotional cocktail of high energy and fuel prices, the biofuels debate, agricultural subsidies, deforestation, water stress and environmental degradation have all been proving too difficult for governments to manage on their own. Around the globe, there is a growing realization that the future world will be resource- and carbon-constrained.

Sustainable development has not “fallen off a cliff”. The world's population will continue to grow, China and India will continue to increase their wealth and use of resources, and everything that comes from the Earth will continue to be under pressure. The need for sustainable development has never been more pressing.

We are in this together. The world needs solutions, and business, as the main tool for innovation and implementation, will help provide them. But first we will need to re-build the public's trust in the markets, and in the private sector's ability and willingness to contribute to a sustainable world.

The financial crisis allows us the opportunity to rethink the role of business and to push forward with the policies and developments necessary to move towards a low-carbon economy. It also highlights the need to work towards achieving widespread energy efficiency, which has the dual benefit of saving money and reducing greenhouse gas emissions.

So what must Barack Obama do first to fix the financial crisis afflicting American business and blighting the world? Quite simply, he must lead for the planet as well as his country. Putting the needs of the Earth, on whose resources we depend, at the forefront of political decision-making is an excellent place to start.

Business knows that what gets measured - gets done. As more and more companies embed sustainable development into their core business strategy, it is becoming increasingly important that we be able to measure progress towards building a more sustainable and inclusive world. Only by measuring and assessing the impact of our actions can we understand what works and what doesn't work and begin to change the way we do business to enhance our positive impact.

In recent years, the WBCSD and others have helped arm companies with the tools they need to start quantifying their contribution to sustainable development. Tools such as the GHG Protocol, Global Water Tool and Ecosystems Services Review have proven useful for understanding a range of environmental impacts.

Our most recent contribution to the toolbox broadens the scope of measurement to include economic and social impacts. The Measuring Impact Framework, launched by the WBCSD Development Focus Area, aims to help companies understand their contribution to society in the areas where they operate. They can then use this understanding to inform their operational and investment decisions and have better-informed conversations with stakeholders.

The Framework consists of 3 components:

1) The business case for measuring impacts, entitled “Beyond the bottom line,” highlighting the experience of several WBCSD member companies;

2) A four-step methodology to identify, measure, assess, and manage impacts; and

3) An Excel-based user guide that helps companies carry out the assessment.

The Framework reflects the collaborative work of over 25 member companies spanning 2 years and can be adapted to any company in any industry operating anywhere in the world. It aims to move beyond traditional reporting by not only helping companies measure their direct impacts and incorporate indirect impacts into their measures of success. It then encourages companies to put these impacts in the development context and ask: what does this mean for the socio-economic development and environmental sustainability of the communities around our business operations?

As highlighted in the Statement of Intent for Doing Business with the World, signed by the leaders of 12 WBCSD member companies, business is committed to moving beyond corporate philanthropy to search for responsible, sustainable and inclusive business models that are good for business and good for development. Key to this commitment is the need to measure the impact of these models and use the lessons learned to modify the models and further optimize the business contribution to society as a whole. We are now working with companies and organizations to implement the Framework and look forward to sharing the lessons learned in the months to come!

Over the past few years many influential reports have helped define the scope of today's climate challenge. These reports include the Intergovernmental Panel on Climate Change's Fourth Assessment Report, the Stern Review, and the International Energy Agency's World Energy Outlook 2007, to name a few.

The emerging picture is that it will be no small feat to change our mix of energy sources in a reasonable time frame. I do think that we will overcome this challenge, but it will not be easy.

The latest of these reports, the International Energy Agency's Energy Technology Perspectives 2008, released in June, shows that a low-carbon future is possible, but requires nothing short of a global energy technology revolution.

In their scenario analysis, the International Energy Agency looks at what it takes to halve current levels of CO2 emissions by 2050. This translates into an equivalent cut in emissions of 48 Gt CO 2 - from 62 Gt CO2 in 2050 in a “business-as-usual” scenario to 14 Gt CO2. These reductions will come from the deployment of technologies:

• 47% is about end use efficiency for fuels and electricity
• 21% comes from renewables
• 32% is connected to power generation, including carbon capture and storage

To achieve reductions on this scale, we're going to need a global framework with far reaching new policies, and we need to act quickly.

When a company invests, it can do so for up to 50 or 60 years. These investment decisions require long term predictability and certainty. Right now, however, there are more questions than answers looming on the climate negotiations horizon:

• What will the new climate regime look like?
• Will there be a longer-term emissions trajectory?
• Will all countries participate?
• Which emissions management programs will be implemented?
• Will there be a global carbon market?

To make the investments necessary to catalyze change, business needs predictability. That's why global business wants a post-2012 global framework to be agreed upon as soon as possible. Without this, there will be no certainty regarding the rules for long term investments, and this lack of clarity will slow down action by business.